Facebook Nailed with $15 Billion Class Action Suit

Concerns about Facebook tracking its users are by no means new. However, a very new $15 billion class action lawsuit could potentially change how the site treats the privacy of its loyal members who log in frequently forever.

Last Thursday California law firm Stewarts Law US filed the $15 billion suit against the social networking site, claiming that Facebook tracks its users even after they have logged out of their accounts. It’s believed that Facebook uses the information gathered from such tracking to tailor advertising for each of its 900 million members.

It’s an absolutely massive suit that involves plaintiffs from over a dozen US states. Together, the class action suit represents a total of 21 individual privacy lawsuits.

As for the $15 billion, it’s based on provisions in the Computer Fraud and Abuse Act, Stored Communications Act, Wiretap Act, and a number of California legal statutes. Those behind the suit say Facebook violated these acts when it tracked its users’ online activity.

Although it’s never a good time to be sued for $15 billion, this is a particularly sensitive moment for Facebook. Last week its shares were publicly traded for the first time, and though the response was generally good the question of many critics remains: how can Facebook really reward investors?

For most, the answer is directly related to expanding Facebook’s advertising power. However, the growth of Facebook as a marketing tool is dependent on its ability to use information gleaned from its members’ online behavior.

For all of these reasons, Stewarts Law US partner David Straite recognizes that this new class action suit will have far-reaching consequences for Facebook and other social media companies.

“This is not just a damages action, but a groundbreaking digital privacy rights case that could have wide and significant legal and business implications,” Straite said.

Facebook is standing firm, however. Company representative Andrew Noyes recently told the media that the suit’s claims are without merit and that Facebook plans to contest them in court.